CP Forecast


Bullish Case: Increased demand for rail services, coupled with strategic expansion and operational efficiency gains post-merger, may drive CP's stock upwards. Rising global trade can further enhance profitability.


Bearish Case: Volatility in commodity prices and potential economic downturns could hinder CP's revenue growth. Integration challenges post-merger may also create operational inefficiencies, leading to a declining stock price.


Potential Outcomes:

1) Price increase due to demand growth (40%);

2) Mean reversion continues (35%);

3) Price decrease from economic shocks (15%);

4) Earnings surprise leads to rapid price jump (10%).


Trading Oracle: Adopt a bullish stance with a 30-day calendar call spread, targeting the $85 strike. This trades on limited downside risk while leveraging CP's recent upward trends in volatility indicators, capitalizing on nearing earnings reports.


July 25, 2024


Canadian Pacific Railway Forecast

CP      Canadian Pacific Railway











Correlated Assets

Assets that tend to move strongly with CP



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.55)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.17)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.28)



Uncorrelated Assets

Assets with little price relationship to CP



LI Forecast + Options Trading Strategies   LI  Li Auto (-0.17)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.28)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.55)



Anticorrelated Assets

Assets that tend to move strongly against CP



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.55)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.17)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.28)





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